The Russian president thinks he is a better poker player
Judged by the din of Russian propaganda, Vladimir Putin has never been closer to winning his war on Ukraine. Yet three years after his invasion, it is not clear what “win” means. His goals are elusive. His “special military operation” was planned in secret. His government was kept in the dark, as were the Russian people. Mr Putin talks of defending Russian sovereignty, but what happens next depends in part on factors outside his control: politics in Ukraine, Europe’s re-armament effort, and above all Donald Trump. Negotiations with the Trump administration began formally on February 18th in Saudi Arabia.
Mr Trump has no clear plan, and his options range from cutting off Ukraine to ramping up military aid and sanctions. The dance between the American president and Mr Putin took another step in Riyadh, in the first direct meeting between American and Russian officials for three years. They agreed to a nebulous series of negotiations on Ukraine and “mutual geopolitical interests”. Preparations will begin for a Trump-Putin summit, although no date was fixed.
These open-ended talks suit Mr Putin just fine. Whereas Mr Trump views them as a way to end a “ridiculous” war, Mr Putin sees them as a stage in a larger conflict, says an American official. The Russian leader calculates he has more staying power than Ukraine or NATO, the creaking Western alliance. Like a poker player, Mr Putin excels in projecting confidence and strength. In reality, though, his cards are not as strong as he would like his opponents to believe, while an end to the war could create complications for him at home.
Any assessment of Russia’s negotiating position should start with the military situation. Its army has performed dismally. The pace of advance is excruciatingly slow: since last July it has struggled to take the town of Pokrovsk, where current losses are staggering. Most of its gains were in the first weeks of the war. In April 2022, following Russia’s retreat from the north of Ukraine, it controlled 19.6% of Ukrainian territory, and its casualties (dead and wounded) were perhaps 20,000. Today Russia occupies 19.2% and its casualties are 800,000, reckon British sources. A western official says “the two armies are fighting each other because they can’t stop, not because they are really hoping to achieve a decisive victory.”
The attrition of equipment is jawdropping. Consider Russia’s stock of Soviet-era armour, built up over decades. More than half of the 7,300 tanks it had in storage are gone. Of those that remain, only 500 can be reconditioned quickly. By April Russia may run out of its T-80 tanks. Last year it lost twice as many artillery systems as in the preceding two years. Recruiting contract soldiers is getting more expensive. A general mobilisation would be politically risky. Public-opinion surveys clearly show that Russians want the war to end.
Russia’s economy has withstood the blow of sanctions thanks to the professionalism of its central bank, high commodity prices and fiscal stimulus. Yet the reallocation of resources from productive sectors to the military complex has fuelled double-digit inflation. Interest rates are 21%, the highest level in two decades. A shortage of labour is chronic. Figures on the economy may not be reliable: the statistics authority constantly revises growth estimates, for example. But a report by the Central Bank and the Ministry of Economy, leaked to Reuters, warns a recession may come before inflation slows. Oleg Vyugin, a former deputy head of the central bank, says the government must soon choose between cutting military spending or galloping inflation. The sovereign wealth fund is being drained. According to Mikhail Zadornov, a former finance minister, its liquid assets have shrunk from 7.4% of GDP to below 2%. Exports, which were $417bn last year, are under pressure from sanctions and lower commodity prices. In December they fell by 20% year on year. Kirill Rogov of Re: Russia, a think-tank, argues that sanctions and a gradual price decline in the basket of exports, including steel and agriculture, would limit Russia’s capacity for aggression.
Such vulnerabilities mean some in the West believe this is the worst possible time for America to be floating rapid concessions to the Kremlin. Even if the West cannot grant Ukraine ironclad security guarantees it could maintain sanctions in order to hold Russia at bay, Mr Rogov argues. Yet Mr Trump is focused on delivering on his promise to end the war quickly, not on constraining and deterring Russia for years. “We are finally getting Putin into the position where we wanted him to be for three years. It would be a terrible shame if we allow him to snatch victory from the teeth of defeat,” an American official says.
Mr Putin believes Mr Trump is not just impatient, but manipulable. He has courted the American president with flattery and instant gratification: on February 11th he released Marc Fogel, an American citizen whom Russia arrested in 2021. Mr Putin’s underlying demands are unchanged. These include a non-aligned Ukraine, whose forces are limited in size and in terms of equipment, and which does not host Western troops. He wants recognition that Crimea and four other annexed Ukrainian provinces are part of Russia. Most importantly, as Mr Putin laid out in June 2024, “the essence of our proposal is not a temporary truce or ceasefire” that would leave sanctions in place and allow Ukraine to rearm. Instead Mr Putin wants a “definitive resolution” that would lift the Western embargo on Russia and allow it to reconstitute its army.
Even if the hot war ends, Mr Putin will continue to try to cripple Europe and re-establish Russia’s sphere of influence. His goal is to break Ukraine and to dismantle the American-led post-1945 order, according to Steve Covington, an advisor to NATO’s Supreme Allied Commander Europe. As Mr Putin told his diplomats last year, “the entire system of Euro-Atlantic security is crumbling before our eyes.” Europe “is being marginalised in global economic development, plunged into chaos…and losing international agency and cultural identity”. He was doubtless pleased to hear J.D. Vance, America’s vice-president, echo this claim on February 15th at the Munich Security Conference. At that event in 2007 Mr Putin first declared his determination to fight the West. The Kremlin no doubt hopes that pro-Russian right-wing parties, whom Mr Vance admires, will gain in European elections.
Gremlins for the Kremlin
Mr Putin’s highest priority is to stay in power. Getting out of war entails its own risks, including the return of hundreds of thousands of soldiers and a fight among different clans. Mr Trump’s diplomacy has given oxygen to moderates who had silently opposed the war. They lack political power, but these “beneficiaries of peace”—private businessmen, economists and some technocrats–hope Mr Trump and his team can change Russia’s trajectory. Unable to confront Mr Putin, they want to persuade him that cooling the confrontation with the West would not endanger, but enhance his security.
On the other side are the “beneficiaries of war”. If confrontation is the foundation of the Putin regime, violence and corruption are its glue. Oligarchic clans benefit from quotas for exporting oil and other commodities in grey markets created by sanctions. (One tycoon likens them to the smuggling schemes run by Iran’s Revolutionary Guards.) They will not part with their lucrative franchises lightly. The security services will be searching both for “fifth columnists” who support peace and ultra-nationalists who will see any deal as a betrayal.
Mr Trump is right to want to “stop the killing”. If a ceasefire allows Ukraine to re-build, triggers higher European defence spending and maintains some sanctions on Russia’s creaking economy it could also see Mr Putin’s ambitions fail. Mr Putin, however, is betting that he can fight for longer than Ukraine can, or that he can manoeuvre Mr Trump into a deal that allows Russia to reintegrate into the world economy, renders Ukraine a divided and semi-failing state, and leaves Europe too stunned to defend itself.
